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▶ Video account attention cross-border navigation It is learned that Kantar and NRF recently jointly released the "2022 Global Top 50 Retailers Ranking". Walmart and Amazon once again occupied the first and second positions respectively, firmly sitting in the top spot.
But Amazon is not satisfied with this. Recently, Amazon has been making frequent moves, such as launching incentives for new sellers and building logistics centers in various places, all of which show Amazon's ambition to be dissatisfied with the status quo. However, cross-border sellers who were hit hard by the wave of account bans last year are not buying into Amazon's series of measures. With internal and external troubles, is Amazon facing a bottleneck? I learned that recently some sellers on the forum reported that the traffic costs in the Amazon market are getting higher and higher, and new products cannot be sold without fake orders . I asked many seller friends and they all said that they have suffered huge losses in doing business on Amazon this year. ▲ The picture comes from Zhiwubuyan In the seller communication group, many sellers even announced the sale of their Amazon stores and chose to leave quietly. ▲ The picture comes from the seller communication group At its root, the main reason is the "internal and external troubles" on Amazon's track in recent years. 1. Industry involution, low-price spiral In recent years, taking advantage of the outbreak of the epidemic and the rise of the stay-at-home economy, a large number of sellers have flocked into the cross-border e-commerce market. In 2021 alone, 472,000 sellers joined the Amazon Mall, which means that there are approximately 1,824 new Amazon sellers every day. As the number of sellers entering Amazon has skyrocketed, the entire Amazon market has become seriously involuted . Many sellers have launched price wars by lowering profits, forming a low-price spiral. While giving up their own profits, they have also brought serious losses to the entire industry. When operations had just resumed in Shenzhen, some sellers reported that although various costs had increased, the prices of many sellers' products had fallen instead of increased, and they chose to keep prices low to maintain volume. ▲ The picture comes from Weibo Some sellers on the forum also said that after spiraling at a low price for half a month, they felt that sales and rankings could be stabilized, and then they raised the price by $1, returning directly to the pre-liberation era. ▲ The picture comes from Zhiwubuyan In the war for buyers among cross-border enterprises, price is indeed a powerful means, but price reduction is also the marketing method that is most easily imitated by competitors. The result of the low-price spiral is often a lose-lose situation. 2. Tighter policies and rising costs Amazon compliance is an inevitable trend. In order to accelerate the seller compliance process, Amazon has vigorously implemented a number of measures in recent years. The policy compliance is becoming more and more stringent, and sellers will be issued "performance notices" if they are not careful. The Amazon account suspension wave that caused an uproar last year was the most notable one.
In addition, increased registration costs, higher insurance requirements, and category requirements for multiple relevant certificates are also challenges that Amazon sellers need to face. Moreover, while Amazon is tightening its policies, it is also increasing various fees for sellers. Not only have storage inventory fees, multi-channel distribution fees, and advertising fees been increased, but Amazon Europe recently announced that it will also increase FBA fees starting March 31. ▲ The picture comes from Amazon announcement Faced with all kinds of adversity, cross-border sellers choose to escape from Amazon and develop new platforms, which seems to have become a new trend in the current cross-border circle. The way out? Many sellers choose to explore new platforms It is learned that recently on the forum, developing new platforms has become a hot topic among sellers. ▲ The picture comes from Zhiwubuyan We also learned that some big sellers’ initiatives to expand across multiple platforms have achieved certain results. Recently, Youkeshu's parent company Tianze Information released its 2021 performance forecast. The report showed that due to the wave of Amazon account bans, Tianze Information's annual net profit loss is expected to exceed 1.8 billion. Based on this, Youkeshu began to choose to deepen its presence on other e-commerce platforms. The 2021 annual report shows that compared with its dismal performance on Amazon, Youkeshu achieved revenue of nearly 60 million yuan on the Walmart platform, a year-on-year increase of 141% ; and Shopee, which accounted for nearly 11% of the revenue, also achieved revenue of 200 million yuan. Zebao's parent company, Xinghui Holdings, which was also affected by Amazon's account ban and suffered an annual loss of more than 1.2 billion yuan, also stated in an announcement recently that the company will accelerate the promotion of its online multi-platform business strategy and increase resource investment in third-party sales platforms such as eBay and Walmart outside of Amazon, as well as self-operated independent sites. Data shows that from July to September 2021, Zebao's independent station achieved sales revenue of approximately 39.23 million yuan, an increase of 152% over the same period last year. The performance forecast released by Tongtuo Technology's parent company Huading Holdings also showed that affected by the account blocking wave in 2021, the company's net profit loss reached 520 million yuan, and a total of 54 stores were banned from sales and closed. Based on this, Tongtuo also stated in an announcement recently that in response to the losses caused by this incident, the company will increase the sales share of other e-commerce platforms such as eBay, Walmart, AliExpress, Lazada, etc., and increase resource investment in its own independent website. Data shows that Tongtuo's self-operated website revenue in the first half of 2021 also reached 50.0586 million yuan. In this regard, we have also summarized the advantages and disadvantages of several popular platforms that sellers are most concerned about, and provide them for reference for sellers who are considering deploying other platforms: 1. High exposure, increase the traffic of sellers' websites 2. Low cost, no monthly fee or store fee required 3. Good reputation, increase product sales 4. There are relatively few sellers and less market competition 1. Low profit and high quality control requirements 3. Some consumers do not agree with the concept of Walmart Marketplace 2. Wide market and many buyers 3. High profits and diversified pricing methods 1. There are many charging items 2. Focus on buyers’ shopping experience and be strict with sellers 1. Local customer service 2. Safe and fast payment collection 3. Powerful management platform 1. Low traffic and low purchase conversion rate 2. The entry threshold is too low
In addition to the above-mentioned large platforms, some niche e-commerce platforms have also attracted much attention from cross-border sellers, such as Meikeduo, Newegg, Cdiscount, etc. However, judging from the feedback from sellers, the effectiveness of this year's multi-platform layout does not seem to be as expected, and many sellers have returned empty-handed. Amazon is still worth cultivating despite its "hit a wall" layout After the Amazon account ban wave, many cross-border sellers realized that "putting all eggs in one basket" does not work . In order to avoid risks, deploying multiple platforms has become the first choice for sellers. However, it was learned that many of the sellers who chose to deploy on multiple platforms in the second half of 2021 said that "the path of deploying on multiple platforms may not necessarily work." A seller mentioned that he had been operating in Walmart for half a year, but the average number of orders per day was only 30, which was not an easy business. Some sellers also said that the company has opened a lot of platforms, and the staff's attention is scattered. They always have to adapt to new platforms, and the products themselves have some problems. The current new platforms are not as uncompetitive as imagined because of the small number of people. The reality is that there are few people and small traffic, and the more they do, the more painful it is. There are also sellers who believe that the performance and product selection are more important than the platform selection. Uncompetitive currency will face low-price involution everywhere. We also learned that as of now, in terms of market size, Amazon is still worth cultivating. According to authoritative organizations, by 2025, global e-commerce sales are expected to reach nearly 24% of total retail sales. Amazon is still the world's most visited e-commerce platform, and by 2022, Amazon will surpass UPS and FedEx to become the largest express delivery service provider in the United States. Rather than considering deploying on multiple platforms, it is recommended that sellers explore new strategies based on the trend of the cross-border market in 2022: Create product differentiation and improve product quality The blind distribution model is obviously no longer feasible in the current highly competitive market environment. In this regard, cross-border sellers can create differences in products or services, build product barriers and meet market demand, which is an effective way to avoid falling into a low-price spiral price war. In addition, improving product quality is also of paramount importance. Only by increasing product added value and technological barriers can we cultivate brand loyalty and enhance the core competitiveness of the enterprise. Pay attention to the consumption trends of overseas buyers and focus on sustainable products Data shows that due to the impact of the epidemic, consumers at home and abroad are currently paying close attention to the sustainable development of the environment. According to a survey conducted by an authoritative organization, consumers are willing to pay more for sustainable products, and 46% of consumers said that protecting the environment is a very important social issue today. In a recent report, 44% of online shoppers around the world said that they have reduced their online shopping behavior due to concerns about sustainability. With the rise of sustainable consumption concepts, sellers are also advised to consider this aspect more when selecting products. Supply chain crises are frequent, and brands urgently need backup plans The current supply chain problem is a concern for all e-commerce merchants. The shortage of inventory and delivery delays caused by the supply chain not only cause trouble to consumers, but also affect the weight of the seller's store on the platform. For example, when a third-party seller is unable to fulfill an order due to insufficient inventory, Amazon will factor these situations into the seller’s rating and will lower the seller’s listing’s ranking in search results. Therefore, until the supply chain crisis normalizes, brands will need a backup plan, consider multiple logistics and distribution options, such as Amazon FBM, and give priority to shipping high-demand products through overseas warehouses.
In 2022, the global e-commerce market still has huge potential, but along with it comes an increasingly fierce market competition environment. To win a place in such an e-commerce market, building a differentiated brand must be the core of the brand's overall sales goals. As the potential of e-commerce continues to explode, its returns will undoubtedly be huge. |
